HomeMy WebLinkAbout07-17-2012 ph2 masp park fee specific plancounci lj aGenaa nEpout Meeting Date
07-17-1 2
Item Number
PH 2
C I T Y O F S A N L U I S O B I S P O
FROM :
Derek Johnson, Community Development Directo r
Prepared By : Phil Dunsmore, Senior Planne r
SUBJECT : AMENDMENTS TO THE PUBLIC FACILITIES FINANCING PLAN OF TH E
MARGARITA AREA SPECIFIC PLAN (SPA 53-12).
RECOMMENDATIO N
As recommended by the Planning Commission :
Adopt a resolution amending Chapter 9 of the Margarita Area Specific Plan to address park s
financing ; and ,
2 . Adopt a resolution amending the development impact fees for the Margarita Area Specific Plan .
DISCUSSIO N
Backgroun d
The Margarita Area Specific Plan (MASP) and associated Environmental Impact Report were approve d
and certified by the City Council in October 2004 with the primary goals of facilitating the production o f
housing and a mix of supporting services and business park development . The MASP incorporates a
comprehensive Public Facilities Financing Plan (Chapter 9) that includes financing for area parklan d
(Attachment 1). Up to 868 housing units are accommodated in the plan which anticipated build-ou t
within approximately 15 years (2019).
Development Impact Fees throughout the City provide a mechanism for projects to fund all or a portio n
of the cost of public facilities related to development . Development Impact Fees in the Margarita Are a
Specific Plan provide a mechanism to fund needed infrastructure, such as Prado Road, and to maintai n
policy-determined levels of facilities, such as parkland .
Reseal l is the developer of two residential subdivisions in the Margarita Area (Tract 2342 and Trac t
2353 – formerly Cowan and DeBlauw). The City has been actively working with the developers t o
finalize the Vesting Tentative Tract Map (VTTM) and to resolve concerns related to developmen t
impact fees for parkland acquisition and improvements . In working with Rescal staff determined tha t
there are opportunities to adjust the parkland impact fees in consideration of how the use of Damo n
Garcia Sports Fields illustrates the facilities community-wide benefit . This report discusses ho w
amendments to the MASP Financing Plan will reflect a more equitable distribution of park costs an d
will facilitate the development of housing projects .
1 Resmark is the parent company . Rescal LLC .is the owner of the property . MD2 is the contract developer for Reseal and i s
managing construction and other related affairs .
PH2-1
Margarita Area Specific Plan Park fees Page 2
The proposed amendments address two items : Removal of a portion (8 .66 acres) of the cost of th e
Damon-Garcia Sports Fields complex from the Margarita Area Specific Plan fee program ; and fee
credits for development projects that dedicate parkland. By clearly identifying and distributing the lan d
and improvement costs associated with park development, the fee structure will be more transparent .
Planning Commission Actio n
The Planning Commission reviewed the proposed amendments to the MASP on June 13, 2012 an d
supported the amendments . The MASP meets the General Plan policy of providing 10 acres of parklan d
per 1,000 residents through inclusion of the parkland in the Specific Plan . The Commission found tha t
the Damon-Garcia Sports Fields, a major park component of the plan, provide a community-wid e
benefit, are heavily used, and serve a regional need that exceeds the responsibility of the MASP . Th e
Planning Commission supported amending the fee structure to reduce the proportion of the Damon -
Garcia Sports Fields' cost attributable to the MASP . In addition, the Commission supported identifyin g
a consistent park fee for all properties in the MASP and amending the Specific Plan language to b e
explicit that fee credits would be available for properties providing parkland dedications . The park
impact fees are comprised of both parkland and improvement costs . The current fee structure attempts
to build in partial credits for those properties dedicating parkland, however, this makes the fees mor e
complex and subject to interpretation . The revised park fees are a more transparent reflection o f
parkland and development costs and provide a mechanism to reduce the fees based on actual dedicatio n
and improvements .
Damon-Garcia Sports Field s
The Damon-Garcia Sports Fields complex, a feature of the MASP, was constructed in 2005 and i s
currently heavily programmed . The facility was constructed with bond funding and the financial plan
does not indicate that this issued debt was to be fmanced with MASP Development Impact Fees . When
the MASP was adopted in 2004, the assumption was that housing and commercial development woul d
quickly follow and would occur in an orderly timeline to provide constant funding to buil d
infrastructure, including parks . Due to a variety of reasons, development is occurring in different stage s
and the financing of public facilities and infrastructure is occurring sporadically .
Clearly, there are significant community-wide benefits being enjoyed by the current residents of Sa n
Luis Obispo through the use of the Damon-Garcia Sports Fields complex, which operates nea r
maximum capacity without any development in the Margarita Area having occurred . To requir e
residential development in the Margarita Area to bear a large proportion of the cost of this importan t
regional park facility, when its use is already highly programmed, is to place a significant burden o n
MASP development.
Policy Directio n
Land Use Elemen t
Land Use Element policy 1 .13 indicates "the costs of public facilities and services needed for new
development shall be borne by the new development, unless the community chooses to help pay the cost s
for a certain development to obtain community-wide benefits ."The proposed amendment to th e
Financing Plan recognizes the community-wide benefit of the Damon-Garcia Sports Fields and propose s
to shift an appropriate proportion of financial responsibility of the costs to develop this park because i t
has community-wide benefit . The responsibility of the MASP residential development to acquire an d
PH2-2
Margarita Area Specific Plan Park fees Page 3
develop a portion of the Damon-Garcia Sports Field complex is proposed to shift commensurate wit h
the amount of current use and expected useful life of the playfields . A finding that funding a large r
portion of the construction and acquisition costs of Damon-Garcia Sports complex represents a
community-wide benefit is supportable given the current recreation demands and the benefits obtaine d
by the entire community . Reducing the amount of MASP park fees applied to the Damon-Garcia Sport s
complex would be consistent with this City policy .
Parks and Recreation Element
Parks and Recreation Element Policy 3 .13 .1 directs the City to "develop and maintain a park system at a
rate of 10 acres per 1,000 residents ."This policy has existed since 1982, was continued in the 199 5
Parks and Recreation Element, and was modified in 2001 to apply the requirement to annexation areas .
The MASP meets the General Plan policy of providing 10 acres of parkland per 1,000 residents throug h
inclusion of the parkland in the Specific Plan.Adjustment to the parkland impact fees does not chang e
the amount of parkland that will be developed with the MASP . In addition to the Damon Garcia Sport s
Fields, the MASP includes greenways for bike and pedestrian trails as well as a 9 .9-acre neighborhoo d
park that includes a concept for a multi-use field, playgrounds, and ball courts .
In 1998, the City Council adopted Guidelines for Acquiring and Improving Park Land in Annexatio n
Areas (Attachment 2). Section B of these guidelines reiterates the policy of maintaining a park syste m
at a rate of 10 acres of parkland per 1,000 residents, but also incorporates Land Use Policy 1 .13 to allo w
the costs for public facilities to be borne by the community if there are community-wide benefits . In
2001, these guidelines were incorporated into the Parks and Recreation Element as Appendix C .
Proposed Amendment s
Amendments to the Margarita Area Specific Plan are proposed as follows :
1.Reduce the proportion of responsibility of cost of the Damon-Garcia Sports complex from th e
MASP development impact fees by 8 .66 acres . Currently, MASP development is responsible fo r
funding 11 .66 acres of the 15 .1 acre sports field . The proposed amendment will reduce th e
developer responsibility to funding 3 .00 acres of the facility . This amendment would reduc e
current impact fees from $13,344 to $8,109 for the development of a single family residence an d
from $9,922 to $6,829 for a multi-family residence . Table 1 below illustrates this amendment .
Attachment 3 identifies text in the MASP that will be edited to correspond to these amendments .
2.Revise the park impact fee schedule to include one fee amount for all properties, howeve r
introduce fee credits for parkland dedication . Current estimates for fee credits would be
$300,000 per acre of unimproved parkland and $535,000 2 per acre for improved parkland . The
City's recent experience in real property acquisition indicates that $535,000 should be adequat e
to cover the costs for acquisition and improvements of the proposed neighborhood park . Th e
proposed amendments would eliminate the fee difference between properties that dedicate and
those that do not dedicate park land . Instead, fee credits would be available for properties wher e
parkland dedication occurs and improvements are completed . The current fee structure does no t
equally split the park fees and places a greater burden on those who dedicate parkland .
2 $535,000 includes both the $300 ;000 estimated land acquisition cost in addition to $235,000 estimated park improvement
costs .
PH2-3
Margarita Area Specific Plan Park fees Page 4
Update table 12 in the MASP to reflect current impact fees and current build-out numbers (base d
on approved subdivisions). This amendment does not change any adopted MASP fee, it simpl y
reflects what the City is currently assessing for water, wastewater, and transportation impact fee s
based on changes to the CPI since the MASP was adopted in 2004 .
Table 1 : Comparison of Current and Proposed Park Impact Fee s
Units Typ e
Single Family Residence
lsumed # o f
I
units
697
Current MASP Park Fees
$13,344 / $7,699*
Proposed Park Fees
$8,10 9
Multi Family Residence 139 $9,922 /
$5,729*$6,82 9
Total 836 $8,323,739**$6,601,204
*Amount based on properties with parkland dedication shown in current MASP .
** Assumes 355 Single Family units and 84 Multi-Family units at the reduced rate as proposed o n
the Damon-Garcia property .
Recommendatio n
Staff and the Planning Commission are recommending an amendment to Chapter 9 of the MASP t o
reflect equitable sharing of the cost for the purchase and construction of the Damon-Garcia Sport s
Fields . Findings can be made that the park provides significant community wide benefits which woul d
support reducing a portion of the development responsibility for the cost of the Damon-Garcia sport s
fields in the fee program . This would reduce the park impact fee to a level that is consistent with th e
proportionate share of future park use from which the Margarita Area is expected to benefit whil e
creating a fee program that is more transparent .
It is currently estimated that by the time the MASP builds out (2030), the Damon-Garcia Sports Fields
improvements will have been in operation for over 25 years . While this facility helped meet the City's
adopted parks per-capita standards, it will have been heavily used by the time the entire MASP area i s
built out and it seems appropriate to reduce the proportion of MASP Development Impact Fees collecte d
for this facility .
Adjusting the fees will advance projects in the MASP that provide housing and commercial growt h
opportunities while helping to accelerate the construction of Prado Road which provides a significan t
east/west transportation link . This project and other projects in the MASP will provide market rat e
housing and position the future development of a significant affordable housing project .
Environmental Revie w
The amendments to the financing plan are exempt from CEQA based on Section 15061 b (3). According
to this provision, where it can be seen with certainty that there is no possibility that the activity i n
question may have a significant effect on the environment, the activity is not subject to CEQA . Since th e
amendments to the financing plan will not result in any physical changes to a project, land use, or site, it
is clear that the changes to the fee structure will not have an effect on the environment . Therefore thi s
activity is not considered a project under CEQA .
PH2-4
Margarita Area Specific Plan Park fees Page 5
Reimbursement Agreement and Final Tract Ma p
A Final Map for a Tentative Tract Map was originally scheduled for approval on April 17, 2012 . Th e
April 2012 staff report recommended approval of the final map because all conditions of approval ha d
been substantially satisfied. However, a request from MD2 to pull the item from the agenda wa s
received just prior to the hearing . While unstated in the request from MD2, the main purpose of th e
delay was to provide an opportunity for Rescal and the City to negotiate a Reimbursement Agreemen t
for the costs of constructing the western portion of Prado Road . The requirements to construct th e
western portion of Prado Road and the option of negotiating a Reimbursement Agreement were
contained in the Tract Map conditions of approval .
It was anticipated that the Final Map would be considered by the City Council at this meeting .
Substantial work has been completed since April and an agreement is nearly negotiated . Th e
outstanding issues include identifying construction costs, including eligible and ineligible constructio n
costs and the terms for reimbursement . It is expected that the Reimbursement Agreement and Final Map
will be on the October 2, 2012 meeting agenda .
CONCURRENCE S
The fee and policy amendments have been drafted in conjunction with the Finance and Informatio n
Technology, Public Works and Parks and Recreation departments . Both the Finance and IT and Publi c
Works Departments have reviewed the proposed text and fee changes and concur with the update a s
proposed .
FISCAL IMPAC T
After review of approved subdivisions and proposed MASP development concepts, the developmen t
build-out assumptions have been revised downward to 697 single family residences and 139 multi -
family units, for a total of 836 units . Based on the current MASP fee schedule (incorporating CP I
increases), in 2011 the 836 units would generate $8,515,669 in park fees in addition to the dedication o f
unimproved 9 .9 acres of parkland . With the revised parks impact fee, the 836 units will generat e
$6,601,204 dollars.
Bond financing was used to fund the purchase and acquisition of the Damon-Garcia Sports Fields .
Funding for bond payments are made from the General Fund with no anticipated receipt of MASP par k
fees to provide relief, though Council retains discretion to use these funds as long as there is a nexus t o
parks . The MASP Financing Plan anticipated development being responsible for a portion of the Sport s
Field complex . This proposed amendment will reduce the ratio of MASP responsibility of the facilit y
cost . The community as a whole has enjoyed the use of the facility for many years with no impact from
MASP properties due to the lack of development . Community wide benefit has been, and will continue
to be, achieved.
ALTERNATIVE S
1 . The City Council can continue consideration of these amendments to a future Council meeting
and ask for additional information before direction is provided on a course of action .
PH2-5
Margarita Area Specific Plan Park fees Page 6
2 . The City Council may direct staff to consider alternative fee structures and return to the Counci l
with proposed amendments . This is not recommended . Rescal Development is relying upo n
amendments to the fee structure in order to move forward with finalizing residential tract map s
and staff has identified an appropriate distribution of responsibility for financing the Sports Fiel d
Complex .
ATTACHMENT S
1
Chapter 9 of the MASP as currently adopte d
2.Parkland acquisition and Improvement in annexation areas guideline s
3.Resolution amending Margarita Area Specific Plan tex t
4
Fee resolution amending Margarita Area Specific Plan park fee s
AVAILABLE FOR REVIEW IN THE COUNCIL READING FIL E
Planning Commission Staff report and Resolutio n
Pre-Annexation agreement that was adopted prior to the MASP for these propertie s
Complete copy of the Margarita Area Specific Pla n
'1':\Council Agenda Reports\2012\2012-07-17\MASP Park Fee Specific Plan Amendment (Johnson-13ourbeau)\CC rpt (7-17 -
12).docx
PH2-6
Attachment l
Public Facilities Financin g
PUBLIC FACILITIES FINANCIN G
9.1 Purpos e
This Public Facilities Financing Plan update ("PFFP") was prepare d
to evaluate the ability of land uses proposed in the Specific Plan t o
fund required public facilities . This chapter describes the approac h
and major findings of the PFFP . Additionally, because developmen t
in the Airport Area Specific Plan is expected to occur concurrentl y
with that in the Margarita Area, the PFFP also incorporates the lan d
uses and infrastructure facilities needs for that area as well . I n
summary, this PFFP does the following :
•Summarizes the proposed land uses and estimated phasin g
assumptions for the Airport and Margarita area s
•Summarizes the public facilities required to serve the Airpor t
and Margarita area s
•Summarizes the costs of required public facilities an d
allocates the costs to the proposed land uses based on a
benefit rational e
Outlines the phasing of transportation facilities needed t o
keep pace with projected development
•Considers a combination of impact fees, debt financing an d
developer contributions to fund public facilities as they ar e
neede d
•Identifies the total one-time burdens (impact fees) an d
potential annual burdens (annual special taxes) proposed t o
be assessed to fund the improvement s
•Discusses future steps associated with implementation an d
administration of the financing plan
Margarita Area Specific Pla n
The PFFP represents the culmination of a cooperative process tha t
involved public and private participants with interests in th e
Margarita and Airport areas .The PFFP may serve as a blueprint t o
guide individual development applications and ensure that futur e
development conforms to the financing strategy outlined in the plan .
It must be noted that the PFFP is also a test of overall financia l
feasibility .
As the Airport and Margarita areas develop, the timing and mix o f
costs and funding sources may change . The assumptions an d
results in the PFFP are generally based on year 2003 estimates an d
future results could be different . However, regardless of the exten t
to which the proposed financing mechanisms are used, or othe r
financing mechanisms are introduced later in the Margarita an d
Airport areas, the feasibility of the overall burden has bee n
evaluated in detail . The analysis shows that the Margarita an d
Airport areas, incorporating the estimated future development mi x
and facilities costs from the backbone infrastructure master plans ,
are feasible proposals from a financial standpoint . Ultimately, th e
marketplace will determine whether the impact fees are competitiv e
and whether the infrastructure, services and other amenitie s
provided by the City are of great enough benefit to foste r
development in the Margarita and Airport areas under City
jurisdiction .
9 .2 City Financing Policie s
As part of developing the financing strategy employed in this PFFP ,
a review of the City's financing policies was conducted . The City's
2003-05 Financial Plan sets forth the following policies :
9 .2 .1 General Financing Policie s
•Development Impact Fees - Development impact fees should b e
created and implemented at levels sufficient to ensure that ne w
development pays its fair share of the cost of constructin g
necessary community facilities .
62 PH2-7
Attacnment 1
Margarita Area Specific Plan Public Facilities Financin g
•Debt Financing - The City will consider the use of debt financin g
only for one-time capital improvement projects and only if, 1) th e
facilities' useful life will exceed the term of the financing and 2 )
the specific revenues or resources will be sufficient to service th e
long-term debt .
•Recurring 0 & M Costs - Debt financing will not be considere d
appropriate for any recurring purpose such as current operatin g
and maintenance expenditures .
•Capital Improvements - Capital Improvements will be finance d
primarily through user fees, service charges, assessments ,
special taxes, or developer agreements when benefits can b e
specifically attributed to users of the facility .
9 .2 .2 Land-Secured Financing Policie s
•Public Purpose - There will be a clearly articulated publi c
purpose in forming an assessment or special tax district i n
financing public infrastructure improvements . This shoul d
include a finding by the Council as to why this form of financin g
is preferred to other funding options such as impact fees ,
reimbursement agreements or direct developer responsibility for
the improvements .
•Reserve Fund - A reserve fund should be established in th e
lesser amount of : the maximum annual debt service ; 125% of th e
annual average debt service ; or 10% of the bond proceeds .
•Value-to-Lien Ratio - The minimum value-to-lien ratio shoul d
generally be 4 :1 . This means the value of the property in th e
district, with the public improvements, should be at least fou r
times the amount of the special tax debt . The City may conside r
allowing a value-to-debt ratio of 3 :1, but the Council would mak e
special findings in this case .
•Capitalized Interest - Decisions to capitalize interest will be mad e
on a case-by-case basis, with the intent that if allowed, it should
improve the credit quality of the bonds and reduce borrowin g
costs, benefiting both current and future property owners .
•Maximum Burden - Annual assessments (or special taxes in th e
case of Mello-Roos or similar districts) should generally no t
exceed 1% of the sales price of the property, and total property
taxes, special assessments and special tax payments collecte d
on the tax roll should generally not exceed 2%.
Special Taxes - Assessments and special taxes will b e
apportioned according to a formula that is clear, understandable ,
equitable and reasonably related to the benefit received by, o r
burden attributed to, each parcel with respect to its finance d
improvement. Any annual escalation factor should generally no t
exceed 2%.
Special Tax District Administration - In the case of Mello-Roos o r
similar special tax districts, the total maximum annual tax shoul d
not be less than 110% of the annual debt service .
Where applicable, these City policies have been incorporated int o
the financing strategy in this PFFP .
9 .3 Land Use Assumption s
9 .3 .1 Land Use s
The Margarita and Airport areas comprise a little over 1,400 acre s
zoned for residential, commercial, industrial, and open space . Whil e
the Airport Area will develop mainly as commercial/industrial, th e
Margarita Area, when fully developed, is expected to includ e
approximately 868 residential units in addition to 69 acres of
business park and 3 acres of neighborhood commercial . Table 6
shows a breakdown of the residential and commercial land us e
components in the Airport and Margarita areas .
63 PH2-8
Public Facilities Financing Margarita Area Specific Pla n
Table 6
LAND USE SUMMARY FOR RESIDENTIAL &NONRESIDENTIAL PROPERTIES
IN THE MARGARITA AREA &AIRPORT AREA SPECIFIC PLAN S
Residential
Estimate d
Dwellin g
Land Use Designations Acres Units
Margarita Are a
Low,Medium Density 60 .8 685
Medium-High ; High Density Mixed Use 9 .9 183
Subtotal 70 .7 868
Airport Area (Existing Development)
Medium Density (Existing Mobile Homes)7 .6 32
Total Residential Property 78 .3 900
Non-Residential Gross
Estimated
Square
Land Use Designations Acres Feet
Margarita Area - Undevelope d
Neighborhood Commercial 3 .1 10,000
Business Park 68 .8 959 .01 7
Subtotal 71 .9 969,01 7
Airport Area - Undevelope d
Business Park 110.1 1,534,70 6
Services Commercial Zone 63 .7 554,954
Manufacturing Zone 49.0 426 .96 5
Subtotal 222.8 2,516,62 5
Airport Area - Developed Land (1)229 .4 2 .116 .000
Airport Area - Developed &Undeveloped Land 452.2 4,632,62 5
Total Non-Residential in Margarita & Airport Areas 524.1 5,601,642
Total Residential &Non-Residential Acreage 602.4
(1) The total square footage (and associated acreage) shown for the Airport Area Specific Plan includes 2 .1 million
square feet of existing or approved for development building space on non-county owned properties ; also not
included is approximately 325,000 square feet of building space on county-owned property .
The estimated nonresidential building capacity in the Airport an d
Margarita areas is approximately 5:6 million square feet . In 2001 ,
the Airport and Margarita areas had approximately 1 .9 million square
feet of existing commercial development and another 0 .2 millio n
square feet that had been approved or was awaiting building
approvals for development . This suggests that future developable
commercial/industrial in the Airport and Margarita areas is just unde r
3 .5 million square feet . Of this 3 .5 million square feet of futur e
space, approximately 2 .5 million square feet are assumed wil l
develop in the Airport Area and 962,000 square feet of space wil l
develop in the Margarita Area .
9 .3 .2 Land Use Absorption Estimate s
Based on historic development trends in San Luis Obispo, the City's
Community Development Department estimates that on average ,
approximately 70 to 80 residential units and 100,000 square feet o f
commercial/industrial building space will develop annually . Base d
on these absorption assumptions, the residential portion of th e
Margarita Area should build out in approximately ten to fifteen year s
and the commercial/industrial acreage in the Airport and Margarit a
areas will fully develop in about thirty-five years .
The land use absorption estimates used in the PFFP illustrate on e
potential development scenario . Because of the inherent uncertaint y
associated with market conditions and evolving events, it i s
emphasized that this absorption scenario is for planning purpose s
only so as to provide an indication of Airport and Margarita area s
feasibility . It should not be relied on as a forecast of future events ,
or for any other purpose other than as an illustration . Actua l
development in the Airport and Margarita areas most likely will no t
follow the smooth development pattern incorporated in the PFF P
analysis but instead will go in cycles with more intense residentia l
activity in the early years .
9 .4 Cost Estimates And Allocatio n
9 .4 .1 Summary Of Cost Estimate s
The total cost of transportation infrastructure and planning cost s
associated with the specific plans for which the Airport and Margarit a
areas are responsible is estimated to be approximately $23 .5 million .
64 PH2-9
Margarita Area Specific Plan Public Facilities Financin g
It is important to note that the $23 .5 million amount does not includ e
the costs for 1) land acquisition associated with roadwa y
infrastructure improvements, 2) existing City, school district, an d
other public agency development impact fees, 3) on-site stor m
drainage detention costs, and lastly 4) in-tract, frontage, and othe r
improvements which individual project developers will fund as thei r
specific projects develop .
The City will require that fronting property owners dedicate roadwa y
right-of-way since these property owners will benefit most fro m
improving the roadway . Development in the Airport and Margarit a
areas will be required to provide on-site or sub-regional storm
drainage facilities .
9 .4 .2 Allocation Methodolog y
With input from the City and its consultant engineers, th e
transportation facility costs were allocated among the various lan d
uses that will benefit from the improvements . Cost allocation factors
were selected, and fair share allocations were assigned to the lan d
uses . Table 7 shows the allocation factors used to allocat e
transportation facilities and specific plan costs to the benefiting lan d
uses .
The following policies and criteria were utilized to assign benefit t o
the Airport and Margarita areas :
•New development must mitigate impacts it creates on publi c
facilities and it is fully responsible for the costs of the require d
mitigation . The City's General Plan states that the City ma y
choose to contribute to certain facilities that it deems will provid e
community-wide benefits .
•Assigned benefit is based on a proportional benefit analysi s
using allocation factors that were determined by the engineer s
and City staff .
Roadway infrastructure costs are allocated to the areas tha t
benefit from these improvements . Prado Road improvements,a
portion of the cost of Prado Interchange, and intersectio n
improvements at Prado and South Higuera are allocated to
future development in the Margarita Area since this area wil l
benefit from these improvements .
Improvements to Tank Farm Road, the Unocal collector, Sant a
Fe Road, and the Buckley Extension are allocated to futur e
development in the Airport Area since this area primarily wil l
benefit from them .
•The City will require property owners whose land adjoin s
roadways to dedicate the right-of-way for improvements ;
therefore, roadway land acquisition costs are not included in th e
transportation infrastructure costs .
•Currently, roadways in the Airport and Margarita areas operat e
at an adequate level of service . The roadway improvement s
proposed in the Airport and Margarita areas specific plans wil l
ensure that an adequate level of service is maintained a s
properties in the Airport and Margarita areas develop . Since th e
roadway improvements will benefit future development in th e
Airport and Margarita areas, the cost of these improvements i s
allocated to them and not the existing development in the Airpor t
and Margarita areas .
Costs provided in Table 8 include only that portion of the tota l
transportation and planning cost that will be allocated to propertie s
in the Airport and Margarita areas . Costs funded by the City or tha t
are the responsibility of the developers, such as in-tract facilities, ar e
not included in the costs or allocation shown in Table 8 . Interim fee s
may be used to reduce the total cost of transportation facilitie s
applied to future development .
65
PH2-10
Public Facilities Financing Margarita Area Specific Pla n
Table 7
COST ALLOCATION FACTORS
Capital Facility:Transportation Specific Plan Costs
Allocation Average Dail y
Land Use Factor:Trip Generation Acres
Residential Trips
Single Family 7.00 per unit per acre
Multi-Family 4.24 per unit per acre
Non-Residential
Neighborhood Commercial 32.41 per ksf per acre
Office/R&D/Lt . Man.13 .48 per ksf per acre
Service Commercial 10 .15 per ksf per acre
Manufacturing 2 .02 per ksf per acre
Table 8
COST ALLOCATION SUMMARY
Total
Transportation Specific Cos t
Costs Plan Costs Allocation
Total Facility Costs $22,749,897 $717,000 $23,466,89 7
Margarita Are a
Residential Per Unit Per Unit Per Unit
Single Family Detached $4,787 $161 $4,948
Multifamily $2,900 $153 $3,053
Nonresidential Per KSF Per KSF Per KSF
Retail $22,165 $141 $22,306
Office/R&D/LL Man .$9,219 $141 $9,360
Airport Area
Nonresidential Per KSF Per KSF Per KSF
Office/R&D/Lt . Man.$4,846 $141 $4,986
Service Commercial $3,649 $225 $3,874
Manufacturing $726 $225 $95 1
66 PH2-1 1
Margarita Area Specific Plan Public Facilities Financin g
9 .4 .3 Infrastructure Phasin g
Development of the Airport and Margarita areas will requir e
approximately $22 .7 million in transportation facilities that will b e
funded by properties in the Airport and Margarita areas . Due to th e
lack of existing infrastructure networks in these two areas,a
considerable amount of transportation improvements is require d
within the Airport and Margarita areas . Infrastructure costs ar e
identified and phased according to estimated infrastructure phasin g
intervals . These intervals are defined in Table 9 below .
Table 9
ESTIMATED INFRASTRUCTURE PHASIN G
Infrastructure
Phasing
Transportation
Specific
Costs
Plan Costs Total
Years
1 - 4 $9,832,229
$717,000 $10,549,22 9
5 - 9 $286,303
-$286,303
10 -14 $8,451,078
-$8,451,078
15 -19 $4,180,288
-$4,180,288
Total $22,749,897
$717,000 $23,466,897
Table 9 provides a breakdown of facility costs for each of th e
separate phases of development . As illustrated in the table, $10 .5
million, or about half of the costs allocated to the Airport an d
Margarita areas, require funding in the early years of development .
An additional $0 .3 million is needed in Phase 2, and another $8 .5
million is required in Phase 3 . The total facilities cost for Phase 4 i s
approximately $4 .2 million . Within the first 15 years of the estimate d
35-year development timeline, approximately 82% of the funding fo r
the Airport and Margarita areas costs is required . This clearl y
presents a funding imbalance since fee revenue will be collected
over the 35-year life of the estimated Airport and Margarita area s
development period, however, a large majority of the facilities
require funding much earlier.
While project-specific development impact fee revenue will b e
available to fund a portion of Phase 1 facilities, sufficient impact fe e
revenue will not be available to fully fund the first phas e
infrastructure nor will fee revenues keep up with major facility cos t
components in subsequent phases . Either public debt financing o r
developer financing will be needed to close the funding shortfall s
and generate lump sum proceeds to keep up with facility demands .
Therefore, the PFFP for the Airport Area and Margarita Are a
incorporates a combination of Airport and Margarita area-specifi c
impact fees, land-secured debt and developer financing to fund th e
required facilities .
9 .4 .4 Water Facilitie s
In 2002, the City adopted updated citywide water fees and area -
specific water add-on impact fees . The area-specific water add-o n
fees were developed to fund the specific water facilities that woul d
be required in the Airport and Margarita areas . These facilitie s
include only the backbone water pipelines that will serve the Airpor t
and Margarita areas and do not include in-tract pipelines at specifi c
developments or water mains that will be required to tie into th e
water system ; these types of facilities will be funded directly by th e
developers when they are ready to develop .
Funding for the expansion of the City's water treatment plant wil l
come from the citywide water impact fee . The citywide water impac t
fee is, effective September 1, 2004, $13,967 per single-famil y
dwelling unit and the area-specific water add-on fee is $779 pe r
single-family dwelling unit (see Table 12 in this chapter for other lan d
use category impact fee rates).
The citywide water fee pays for water supplies and treatmen t
facilities required to serve new development and as such must b e
paid by development in addition to the Airport and Margarita area -
specific water add-on fee . The water impact fees will be collected a t
67 PH2-1 2
Public Facilities Financing Margarita Area Specific Pla n
building permit issuance or possibly at some other time, as specifie d
by the City .
The City anticipates that 1 .7 million square feet of the existing 2 .1
million square feet of developed and/or approved building space wil l
tie into the water system over a 30-year period . Approximately 0 .4
million square feet of developed space is in the ,Fiero Lane Wate r
District and is not expected to connect to the City's water system .
Of the remaining 1 .7 million square feet, approximately 0 .5 millio n
square feet of development has already paid interim impact fees t o
the City .
Existing development requesting to tie into the City's water syste m
will be required to pay the Airport and Margarita area-specific wate r
add-on fee and the citywide water impact fee .
9 .4 .5 Wastewater Facilitie s
The cost of the Airport and Margarita area specific plans' portion o f
the water reclamation facility upgrade will be funded through th e
citywide wastewater impact fee . The collection system pipes, whic h
will connect individual developments to the backbone system ar e
considered to be an in-tract improvement and therefore will b e
financed by the individual developers .
Development in the Airport and Margarita areas will be required t o
pay the citywide wastewater impact fee, which is, effective
September 1, 2004, $3,377 per single family dwelling and the area -
specific wastewater add-on fee is $1,489 per single-family dwellin g
unit .
Revenue from the citywide wastewater fee will fund capacit y
improvements at the water reclamation facility and therefore al l
development in the Airport and Margarita areas will be required to
pay this fee in addition to the Airport and Margarita area-specifi c
wastewater add-on fee .
The City expects that the existing and/or approved 2 .1 million squar e
feet of building area in the Airport and Margarita areas will eventually
tie into the City's sewer system . Approximately 0 .5 million squar e
feet of development has already paid interim impact fees to the City .
The City anticipates that most of the remaining 1 .6 million squar e
feet of developed building space will tie into the wastewater syste m
over a 30-year period . Existing development requesting to tie int o
the City's sewer system will be required to pay the Airport an d
Margarita area-specific wastewater add-on fee and the citywid e
wastewater impact fee .
9 .4 .6 Transportation Facilitie s
Road and bikeway improvements required for the Airport an d
Margarita areas are estimated to cost $22 .7 million, $6 .0 million les s
than the $28 .5 million cost in the original PFFP . This amoun t
reflects the costs associated with improvements for Prado Road ,
Tank Farm Road, the Unocal Collector, Santa Fe Road Extensio n
and Buckley Road Extension . Also included is the Airport Area's
share of bike path costs and Margarita Area's share of the cost fo r
the Prado Interchange and intersection improvements at Sout h
Higuera and Prado . Costs have been increased by approximatel y
4 .1%, based on the two-year increase in the U .S . Bureau of Labo r
Statistics consumer price index for all urban consumers all citie s
average, to reflect cost increases since the original PFFP wa s
completed in 2001 and will continue to reflect changes in the CPI .
As previously mentioned, the City will require that roadway right-of -
way be dedicated by the adjoining property owners and as a result ,
land acquisition costs are not included in the transportatio n
infrastructure costs .
Future development in the Margarita Area will benefit from th e
improvements to Prado Road (including the Prado Road cree k
crossing) and the intersection at South Higuera Street . Therefore ,
costs associated with these improvements, about $10 .1 million, have
been allocated only to future development in the Margarita Area .
Additionally, based on a prior study, the City estimates that future
development in the Margarita Area is responsible for 13%, or $2 .9
million, of the $22 million Prado Interchange . The total cost of th e
aforementioned improvements, approximately $13 million, i s
68 PH2-13
Margarita Area Specific Plan Public Facilities Financin g
allocated among all future development in the Margarita Area base d
on the trip generation factors shown in Table 7 .
Future development in the Airport Area will primarily benefit from th e
improvements to Tank Farm Road, the Unocal Collector, Santa F e
Road Extension and Buckley Road Extension and therefore, existin g
development in the Airport Area is not allocated these costs . Costs
include roadway improvements and median landscaping an d
irrigation for Tank Farm Road . The original PFFP did not include th e
Buckley Road Extension and assigned the Unocal Collector an d
Santa Fe Road Extension improvement costs to the fronting propert y
owners .
The total cost of these roadway improvements is approximately $7 .8
million and is allocated solely to future development in the Airpor t
Area . Additionally, $2 .0 million in bikeway costs is allocated to th e
Airport Area (similar improvements in the Margarita Area will be buil t
as part of specific development projects).
Utility line undergrounding for Tank Farm Road and Broad Street wil l
be funded through the City's Rule 20A program . In the origina l
PFFP, undergrounding costs were to be funded by development i n
the Airport Area . Additionally, the cost of constructing medians o n
Broad Street, south of Prado Road, will be funded by the City
through grants, STIP and TEA funds . In the original PFFP, th e
Broad Street median cost was proposed to be funded b y
development in the Airport Area .
In addition to the Airport and Margarita areas transportation impac t
fee, future development in the Airport and Margarita areas will als o
be required to pay the citywide transportation impact fee, ($1,51 9
per single family dwelling as of September 1, 2004). Revenue fro m
this fee funds transportation projects which provide a citywid e
benefit and therefore development in the Airport and Margarita area s
will be required to pay this impact fee in addition to the Airport an d
Margarita area-specific transportation impact fee .
All traffic mitigation measures, taken as a whole at full build out o f
the Airport Area, assure compliance with the Circulation Element
LOS D policy . However, due to the fact that the rate and exact
development patterns within the Airport Area cannot be predicted ,
no fixed implementation schedule of overall traffic mitigatio n
measures can be determined . Therefore, and although no t
anticipated, certain projects may cause a temporary traffic level o f
LOS E to be reached . The City shall, on a bi-yearly basis or a s
needed, review LOS levels and make recommendations for use o f
accumulated Airport Area transportation impact fees toward new CI P
projects to address the higher LOS levels and assure ultimate LO S
levels are achieved with ultimate build-out of the Airport Area .
9 .4 .7 Storm Drainage Facilitie s
Future development in the Airport and Margarita areas will b e
required to provide on-site drainage facilities instead of the regiona l
storm drainage facilities . The funding for the on-site drainag e
facilities will be the responsibility of the individual developers an d
therefore Airport and Margarita area-specific storm drainage fee s
are not calculated in this PFFP .
9 .4 .8 Specific Plan Cost s
Funds have been advanced by the City to pay consultants' cost s
associated with preparing the specific plans and other analyses to
support development of the Airport and Margarita areas . Thes e
costs are estimated to total $717,000 and have been allocated to al l
future development in the Airport and Margarita areas on a per-acr e
basis . The existing development in the Airport and Margarita area s
is not included in the cost allocation . The cost allocation for this ite m
ranges from $153 per multi-family unit to $141 per 1,000 square feet
of service commercial and manufacturing building space .
9 .5 FINANCING METHOD S
9 .5 .1 Mello-Roos Community Facilities Act Of 198 2
In 1982, the California State Legislature enacted the Mello-Roo s
Community Facilities Act (the "Act") [Section 53311 et . seq . of th e
69 PH2-14
Public Facilities Financing Margarita Area Specific Pla n
Government Code] to provide an alternate means of financing publi c
infrastructure and services subsequent to the passage of Propositio n
13 in 1978 . The Act complies with Proposition 13, which permit s
cities, counties, and special districts to create defined areas withi n
their jurisdiction and, by a two-thirds vote within the defined area ,
impose special taxes to pay for the public improvements an d
services needed to serve that area . The Act defines the are a
subject to a special tax as a Community Facilities District .
A CFD may provide for the purchase, construction, expansion, o r
rehabilitation of any real or other tangible property with an estimate d
useful life of at least five years . A CFD may also finance the costs of
planning, design, engineering, and consultants involved in th e
construction of improvements or formation of the CFD . The facilities
financed by the CFD do not have to be physically located within th e
CFD .
Formation of a CFD authorizes a public agency to levy a special ta x
on all taxable property within the CFD in the manner prescribed i n
the formation documents . Property owned or irrevocably offered to
a public agency may be exempted from the special tax . Mello-Roo s
special taxes are collected at the same time and in the sam e
manner as property taxes, unless otherwise specified by the agency .
Special tax revenues may be used to pay debt service on bond s
sold to provide funding for the construction or acquisition of publi c
capital facilities . Special taxes may also be used to pay directly fo r
facilities and public services . Formation of a CFD can be initiate d
by :
•A motion by the legislative body (the City Council);
• A written request signed by two members of the City Council;o r
•A petition filed with the clerk signed either by ten percent of th e
registered voters residing within the proposed CFD, or owners o f
ten percent of the land area within the proposed CFD .
Within 90 days of initiating the proceedings to form the CFD, the Cit y
Council would adopt a resolution of intention to establish a CFD an d
a resolution of necessity to incur bonded indebtedness, and
determine a date for a public hearing on the formation of the CFD .
The hearing must be not less than 30 days or more than 60 day s
from the date the resolution of intention was adopted . At the publi c
hearing, if the City Council makes a decision to proceed wit h
formation of the CFD, a resolution of formation, a resolution to incu r
bonded indebtedness, and a resolution calling for elections t o
authorize special taxes and the issuance of bonds, will be adopte d
by the City Council .
If the City Council decides to proceed with establishing a CFD, i t
must submit the levy of the special tax to the qualified electors of th e
proposed CFD in the next general election or in a special election t o
be held at least 90 days, but not more than 180 days, following th e
close of the public hearing . However, these time limits may b e
waived with the unanimous consent of the qualified electors . As
required by Proposition 13, two-thirds of the voters casting ballot s
must support the tax if it is to be imposed . However, if there ar e
fewer than 12 registered voters residing in the proposed district, th e
vote shall be by the landowners of the proposed CFD, and eac h
landowner shall have one vote for each acre or portion of an acre o f
land owned within the CFD .
There are two limitations on the amount of financing available from a
CFD . The first is the value-to-lien ratio . "Value" is considered to b e
the appraised value of the property, including entitlements an d
improvements in place on the date the CFD bonds are to be sold .
The value of improvements to be constructed with bond proceeds i s
included in the value calculation . "Lien" refers to the propose d
Mello-Roos bond issue, as well as any other public debt secured b y
the property . Senate Bill 1464, which became effective Januar y
1993, requires a minimum value-to-lien ratio of 3 :1 . The City's policy
is 4 :1, but may also allow 3 :1 in some cases .
The second restriction on the amount of financing available from a
CFD is the total effective tax rate ("ETR") paid by a homeowner o r
property owner in the CFD . The ETR consists of the basic on e
percent ad valorem property tax levy mandated by Proposition 13 ,
plus overrides from voter-approved bonded indebtedness and non -
70 PH2-15
Margarita Area Specific Plan Public Facilities Financin g
ad valorem taxes, assessments and parcel charges (expressed as a
percentage of market value).
There is no legal limit, but a maximum ETR of two percent of marke t
value has developed as a standard for residential development i n
many areas throughout the State ; the City has adopted this standard
as one of its financing policies . It is thought that ETRs higher tha n
two percent may lead to market resistance by prospective hom e
buyers, or potential "taxpayer revolts" by overburdene d
homeowners . The maximum supportable ETR for a given projec t
should also consider the maximum tax rates paid by homes i n
competing projects in the area and, based on the strength of the rea l
estate market, the demand for homes in general .
Commercial/industrial projects often support higher ETRs, as th e
property owner is able to spread the tax burden among man y
tenants and, therefore is less sensitive to a higher ETR .
9 .5 .2 Impact Fees
Impact fees are monetary exactions (other than taxes or specia l
assessments) that are charged by local agencies in conjunction wit h
approval of a development project . Impact fees are levied for th e
purpose of defraying all or a portion of the costs of a public facility ,
improvement, or amenity that benefits the project . The collection o f
impact fees does not require formation of a special district ; instead ,
a fee program is implemented by a public agency's adoption of a
resolution or ordinance .
Builders or developers pay impact fees, typically at the time a
building permit is issued . The public facilities funded by impact fee s
must be specifically identified, and there must be a reasonabl e
relationship, or "nexus," between the types of development projec t
and the need for the facilities, the need to impose a fee, and th e
portion of the facilities cost allocated to the development project ,
pursuant to Section 66000 et . seq . of the Government Code .
While developer fees cannot typically be leveraged (i .e ., provid e
security for bonds or other debt instruments), fees can be used i n
conjunction with debt financing to help retire bonds secured by other
means (e .g ., land). In this case, developer fees can generat e
supplemental revenues to reduce future special taxes o r
assessments, or free up tax increment or other revenues fo r
alternative uses . Developer fees can also be used to generat e
reimbursement revenue to property owners or public agencies tha t
have previously paid more than their fair share of publi c
improvement costs .
9 .5 .3 Developer Financin g
In many cases, developers fund facilities or dedicate land as a
means of mitigating the impact of their developments . For example ,
the City may impose, as a condition of development, construction o f
a facility that is needed, such as a roadway . Once the roadway i s
constructed and accepted by the City, fee credits equal to th e
amount of the cost of the facility or the cost of the facility a s
estimated in the capital improvement plan, can be issued to th e
developer . The developer can then apply them to offset fee s
imposed on his development or enter into a reimbursemen t
agreement for any constructed facility that is oversized .
9 .6 Recommended Project Financing Strateg y
9 .6 .1 Overvie w
The financing strategy for funding infrastructure serving the Airpor t
and Margarita areas is a combination of impact fees specific to th e
Airport Margarita areas, community facilities district debt financing ,
citywide and add-on impact fees, and developer funding and lan d
dedications . Additionally, funding from the City will be required fo r
the construction of a median on Broad Street . Table 10 summarize s
the facilities required and the infrastructure funding sources for th e
Airport and Margarita areas .
Margarita Are a
The City expects that construction of Prado road will be set as a
condition of development in the Margarita Area . Initial developmen t
71
PH2-16
Public Facilities Financing Margarita Area Specific Pla n
will be required to construct the roadway and will then receive fee which has not already paid interim impact fees to the City, will als o
credits, which can be used against the Margarita area-specific be required to pay citywide and add-on water and wastewate r
transportation impact fees . Reimbursement agreements between impact fees when the property owner decides to tie into the City's
developers and the City may also be entered into on a case-by-case water and wastewater systems .
basis in which the developers would be repaid for any facilities tha t
are oversized .
Another financing strategy, as shown in Table 10, for the Margarit a
Area's share of its allocated infrastructure costs would fund thes e
facilities costs through a community facilities district . Based on th e
bond and special tax assumptions outlined in Table 11, the
Margarita Area CFD would fund approximately $13 .0 million of
transportation improvements and specific plan costs .
If CFD bond funding is used, development in the Margarita Area wil l
not pay Margarita Area project-specific impact fees for transportatio n
facilities or the specific plan (except for parks) but would still b e
required to pay the citywide water, wastewater and transportatio n
fees and the add-on impact fees for water and wastewater . Th e
citywide impact fees fund facilities that provide community-wid e
benefits and therefore, development in the Margarita Area mus t
contribute to its fair share of the costs . The Margarita Area will b e
required to dedicate and/or pay impact fees toward parkland an d
park improvements, as well as impact fees imposed by othe r
agencies such as the school district . Land dedications for Prad o
Road will also be required from fronting property owners .
Airport Area
The recommended financing strategy for the Airport Area's share o f
its allocated infrastructure costs is a combination of Airport Area -
specific transportation impact fees developer-constructed roadway s
and land dedication . In addition, payment of citywide water ,
wastewater, and transportation impact fees and the add-on impact
fees for water and wastewater will be required . The Airport Are a
Project impact fees, shown in Table 12, will fund the Airport Area's
fair share of the transportation and specific plan costs . Owners of
properties fronting roadways will be required to dedicate road right -
of-way . Existing and/or approved development in the Airport Area
72 PH2-17
Margarita Area Specific Plan Public Facilities Financin g
Table 1 0
PUBLIC FACILITIES FINANCING MATRIX
Margarita Area Impact Fees Airport Citywide City
Transportation Area Development Rule 20A Impact Fees Funding
& Specific Plan Water &Impact East of Funding Project or Service Vi a
Facility Preparation Sewer (1)Fees (1)Broad Street Program Developers Rates Grants Totals
Water Facilitie s
Water Pipeline s
In-Tract Water Distribution Syste m
Portion of Water Treatment Plant Cost
X X
X
X
Wastewater Facilitie s
Pump Stations X X
Collection System Piping X
Portion of WRF Upgrade Cost X
Transportation Facilitie s
Prado Road Improvements $9,832,229
Portion of Prado Road Interchange $2,860,00 0
Prado & Higuera Intersection $286,30 3
Tank Farm Road (incl . Median Improvements)$4,953,63 5
Tank Farm Road Utility Undergrounding X
Unocal Collector $746,58 2
Santa Fe Extension $1,403,64 6
Buckley Extension $664,20 7
Bike Paths - Airport Area $2,003,29 5
Bike Paths - Margarita Area X
Broad Street Median Improv . (south of Prado)X
Broad Street Median Improv . (north of Prado)X X
Broad Street Utility Undergrounding X
Subtotal $12,978,531 $9,771,366 $22,749,89 7
Storm Drainage Facilitie s
On-Site Drainage Detention X
Specific Plan Costs $279,814 $437,186 $717,000
Park Costs & Land Dedication (2)x X
Total $13,258,346 $10,208,551 $23,466,897
Note : An "X" in a column signifies that funding from the specified source will be required .
(1)Includes the City's area-specific "add-on" fees .
(2)See Table 12
PH2-1 8
7 3
Public Facilities Financin g
Other Financing Option s
The financial imbalance caused by the need to fund the majority o f
infrastructure costs upfront while development in the Airport an d
Margarita areas is expected to occur over a thirty five-year perio d
poses a challenging situation for the City . While conditionin g
development to construct roadway facilities or forming a CFD for th e
Margarita Area to fund these upfront costs, other costs still ma y
require funding . Several options are available to the City to addres s
these funding shortfalls . The City will, on a case-by-case basis ,
review the funding shortfall as it occurs and determine th e
appropriate solution at that time . Several funding options availabl e
to the City are discussed below .
Forming one or more community facilities districts in the Airport Are a
will provide upfront funding for infrastructure facilities in the initia l
stages of development when much of this is needed . A CFD coul d
incorporate all the undeveloped Airport Area or simply portions o f
the Airport Area, such as the properties on the east or west side o f
the Airport Area . The CFD(s) could be formed when properties i n
the Airport Area are ready to develop and could finance facilities tha t
would otherwise be funded through Airport and Margarita are a
impact fees .
Another potential funding option would be to impose, as a conditio n
of development, a requirement that a developer construct a require d
facility and then receive credits in the amount of the constructio n
cost . The developer could then apply these credits against hi s
development impact fees . This approach is used frequently b y
public agencies when facilities are needed before development ca n
proceed .
A third option would be to delay construction of all nonessentia l
infrastructure until the required fee revenues or other funding ar e
collected . This approach,however, may not be feasible in man y
cases .
The City could also provide the necessary funding and then b e
reimbursed as impact fee revenue is collected . This could be
Margarita Area Specific Pla n
accomplished by borrowing from other City capital improvemen t
funds and then repaying, with interest, the fund when impact fe e
revenues are collected from the Airport and Margarita areas .
9 .6 .2 Community Facilities District Bond Analysi s
Table 11 summarizes the results of the CFD bond analysis . As
mentioned, the analysis assumes that the CFD boundary woul d
encompass the Margarita Area . Facilities funded through the CF D
would include all the transportation facilities and specific plan cost s
allocated to the Margarita Area . The total cost of the facilitie s
funded in year 2003 dollars is approximately $13 .0 million .
Assuming 2 years of capitalized interest, bond issuance costs and a
reserve fund, the bond issue is estimated to be approximately $1 8
million . Based on this bond amount, the annual special tax rate s
shown in the bottom half of Table 11 will need to be levied annuall y
to cover bond debt service . The tax rate for a single-family unit wil l
be $1,100 . This annual tax as a percentage of the average hom e
value is about 0 .35%. With the 1 .11% property tax (including voter -
approved taxes), the total annual tax burden is 1 .45% of propert y
value . This is much lower than the City's limit of 2 .0% and wel l
within range of typical tax burdens found throughout the state . Fo r
office development, the annual tax burden is 1 .89%, which also i s
within the range of typical annual tax burdens on office properties i n
the state .
The initial value-to-lien ratio, which is required to be, at a minimum ,
4 to 1 pursuant to City policy, may or may not be a limiting factor t o
the size of the initial bond issue . Based on a $ 18 million bond size ,
the value of entitled undeveloped land within the CFD would have t o
be approximately $360,000 per acre to achieve the necessary 4 to 1
value-to-lien ratio . An appraisal of the properties in the CFD woul d
be conducted just prior to a bond sale to determine the value an d
whether the value-to-lien ratio is within City policy guidelines .
If the value-to-lien is less than 4 to 1, two possible solutions exist .
First,two separate bonds could be issued, one in the first year and a
second when property values are high enough to support a secon d
issue . Second, the City could issue the full $18 million bond amount
74 PH2-19
Margarita Area Specific Plan Public Facilities Financin g
in the first year and escrow a portion of the construction funds until a
4 to 1 value-to-lien is reached . Once the necessary 4 to 1 value-to -
lien ratio is reached, construction funds would be released to fun d
the remaining infrastructure costs . Alternatively, the City coul d
decide that a value-to-lien ratio of 3 to 1 is sufficient for the CFD .
Table 1 1
COMMUNITY FACILITIES DISTRICT CASH FLOW ANALYSIS SUMMAR Y
(MARGARITA AREA ONLY)
9 .6 .3 Impact Fee Analysi s
Margarita Area Transportation and Specific Plan Fee s
Table 12 shows the Margarita area-specific impact fees fo r
transportation and specific plan costs.The table also shows the
citywide and add-on impact fees for the Margarita Area . Should the
City pursue the facilities funding through CFD bond funding, impact
fees for transportation and the specific plan for the Margarita Are a
would not be required since all costs allocated to the Margarita Are a
could be funded through the CFD . All citywide and water an d
wastewater add-on impact fees and owner-specific park fees will b e
imposed, however .
Citywide and add-on water and wastewater impact fees shown i n
Table 12 for nonresidential development assume a 1 .0 inch size
meter . This is for illustration only ; the meter size and thus the wate r
and wastewater impact fees will vary based on water an d
wastewater needs and requirements.
Airport Area Transportation and Specific Plan Fee s
The bottom section of Table 12 shows the Airport area-specifi c
impact fees and the citywide and add-on impact fees for the Airpor t
Area . Airport area-specific transportation and specific plan impac t
fees combined range from $726 to $4,846 per 1,000 square feet of
building space for nonresidential properties .
Existing development in the Airport Area will be subject to th e
citywide and Airport area add-on water and wastewater impact fee s
when these properties decide to tie into the City systems .
The City may wish to establish one capital facilities account for th e
Airport Area and pool the separate Airport area-specific impact fees .
This would preclude the necessity of inter-fund borrowing betwee n
separate accounts . The City will still be required to justify th e
separate impact fee components within the consolidated Airpor t
Area impact fee as required by the Mitigation Fee Act, also know n
as AB 1600 . The impact fees presented in this PFFP are subject t o
CFD Boundary Area
Margarita Area S P
Facilities Financed Margarita Area's Allocated
Share of Transportation &
Specific Plan Costs
Total Facility Costs Funded
$13,258,346
Bond Term
30 Years
Bond Interest Rate
7 .0 %
Capitalized Interest
2 Years
Bond Debt Service Annual Increase
1 .0%
Bond Issuance Costs (as % of Bond)
5 .0%
Bond Reserve Fund (as % of Bond)
9 .0%
Total Bond Sales Required
$18,060,000
Annual CFD Tax Rates & Total Burden Annual
Annual Burden as
Facilities
% of Avg.Property Value
Special
(Incl . Base Property Ta x
Tax
& Voter Approved Taxes )
Residential
Single Family Detached
Multifamil y
Nonresidential
Units
Per Unit
Per Unit
741
$1,100 .
1 .45%
127
$880
1 .55%
Acres
Per KSF
Per KSF
Retail
3 .1
$649
1 .64 %
Office/R&D/Lt . Man.
68 .8
$649
1 .89%
75 PH2-20
Public Facilities Financing Margarita Area Specific Pla n
change as cost estimates and assumptions are refined, or if the Cit y
makes policy decisions that affect the plan .
Margarita Area :Park Fee s
The City's parkland standards are set forth in the General Plan at 1 0
acres per 1,000 residents . In implementing this standard, th e
Council adopted the policy Park Land Acquisition and Improvemen t
in Annexation Areas in April 1998 . In summary, this policy provide s
that new development in annexation areas (as well as whe n
discretionary approvals are requested, such as zone changes ,
general plan amendments or specific plans) is responsible for th e
cost of acquiring and improving park land as required to meet thi s
General Plan standard .
Since this standard is only applicable to residential development, i twasnot included with the joint Airport/Margarita Area infrastructur e
analyses . Instead, the City prepared a separate analysis of parklan d
costs, fees and credits in March 1998 . This analysis has bee n
updated to reflect changes since then, and the results are presente d
in Table 12 A and B .
The following summarizes the key assumptions in this analysis :
1 . Based on 868 housing units and population per househol d
from the 2000 Census, there will be 2,156 residents in th e
Margarita Area .
2.At 10 acres per 1,000 residents, this means that ne w
development in this area is responsible for providing 21 .5 6
acres of developed parkland .
3.Overall, the plan calls for 25 acres of parkland in this area :
9 .9 acres in neighborhood park and 15 .1 acres in sport s
fields . Of the total parkland planned for the area, ne w
development is responsible for 21 .56 acres and the City fo r
3 .44 acres . In meeting the standard for this area, this result s
in 9 .9 acres in neighborhood parks and 11 .66 acres in sport s
fields .
4.Land costs are estimated at $200,000 per acre and par k
development costs at $235,000 per acre .
5.The analysis of costs and credits assumes that the land fo r
the neighborhood park will be dedicated by the propert y
owners . As such, they will receive a credit for the value o f
this dedication in meeting their parkland requirement .
Likewise, the City will be reimbursed for its advanced cost s
of acquiring and improving the portion of the sports fiel d
costs allocable to the Margarita Area .
This results in the following park fees per unit :
MASP Park Fees Per Residential Unit Single Multi -Multi -
Family Famil y
Development Dedicating Land for 9 .9 $6,481 $4,82 3
Acre Neighborhood Park
Other Development 11,223 8,352
76 PH2-2 1
Margarita Area Specific Plan Public Facilities Financin g
Table 1 2
AIRPORT AREA/MARGARITA AREA PROJECT SPECIFIC &CITYWIDE IMPACT FEE S
(1)Excludes Park Improvement Fees : See Tables 12a and 12b .
(2)In addition to the Airport/Margarita Area project specific impact fees, new development in the Specific Plan areas will also be subject to citywide an d
Airport/Margarita add-on impact fees; citywide and add-on impact fee rates are effective as of September 1, 2004 .
(3)Water and wastewater impact fees are based on meter size for non-residential uses in determining "equivalent dwelling units ." For example, a 3/4- inc h
meter is the equivalent of one single-family residence (EDU); a one-inch meter is two EDU's ; a two-inch meter is 6 .4 EDU's; and a three-inch meter is 14 EDU's .
77
Airport &
Airport &
Total
Margarita
Margarit a
Project
Citywide
Areas
Citywide
Areas
Citywid e
Specific
Impact Fees
Water
Water
Wastewater Wastewater
Transportatio n
Transportation Plan Costs
(Note 1)
Fee
Add-On Fee
Fee
Add-On Fee
Fee
Margarita Area : Project Impact Fees Citywide and Add-On Impact Fees (Note 2 )
Residential
Single Family Detached
Multifamily
Nonresidentia l
Retail
Office/R&D/Lt . Man .
Total
Per Unit Per Unit
$4,787
$161
$4,94 8
$2,900
$153
$3,05 3
Tota l
Per 1,000 SF Per 1,000 SF
$22,165
$141
$22,30 6
$9,219
$141
$9,360
Airport Area : Project Impact Fees Citywide and Add-On Impact Fees (Note 2 )
Nonresidentia l
Office/R&D/Lt . Man .
Service Commercia l
Manufacturing/Indus .
Tota l
Per 1,000 SF Per 1,000 S F
$4,846
$141
$4,98 6
$3,649
$225
$3,87 4
$726
$225
$951
Per Uni t
$13,967
$779
$3,377
$1,489
$1,51 9
$11,174
$623
$2,702
$1,191
$1,34 8
Per 1" Meter (Note 3)Per 1,000 S F
$27,934
$1,558
$6,990
$2,978
$2,398
$27,934
$1,558
$6,990
$2,978
$3,049
Per 1" Meter (Note 3)Per 1,000 S F
$27,934
$1,558
$6,990
$2,978
$3,04 9
$27,934
$1,558
$6,990
$2,978
$1,65 3
$27,934
$1,558
$6,990
$2,978
$879
P H2-22
Public Facilities Financing Margarita Area Specific Pla n
TABLE 12 a
City of San Luis Obisp o
Margarita Area Specific Pla n
PARK IMPROVEMENT FEE S
Single Family Residential Multi-Family Residentia l
Population per Household 2 .58 Population Per Household 1 .9 2
City Park Standard (acres per 1,000 res .):10 .00 City Park Standard (acres per 1,000 res.):10 .0 0
Parks Acres Required per Household :0 .0258 Parks Acres Required per Household :0 .019 2
Park Costs :$235,000 per acre Park Costs :$235,000 per acre
Cost/Fee per Single Family Unit (1)$6,063 per unit Cost/Fee per Multi-Family Unit (1)$4,512 per unit
(1) Does not include the cost of land acquisition .
78 PH2-2 3
Margarita Area Specific Plan Public Facilities Financin g
TABLE 12b
City of San Luis Obisp o
Margarita Area Specific Pla n
PARK IMPROVEMENT FEE S
Value of Acreage Dedications and Net Fee Contribution s
1 .Parkland Dedication Surplus/(Deficit )
(IA)(1B)(IC)(ID)(1E)(IF)
Owner
Residential
Units Proposed
Populatio n
Generate d
From Units
Park Acreage
Required Based
on City Standard
Actual
Park Acres
Dedicated/1
Surplus/(Deficit)
Acreage
Contributio nSingle Family Multi-Famil y
King 181 20 505 5 .05 0 (5.05)
DeBlauw 159 23 454 4 .54 0 (4 .54)
Cowan 46 0 119 1 .19 0 (1 .19)
Garcia/Damon 355 84 1,077 10 .77 9.90 (0.87 )
City of San Luis Obispo na na na na 11 .66 11 .66
Total 741 127 2,156 21 .56 21 .56 0.00
2. Net Fee Calculation After Parkland Dedicatio n
(2A)
Owner
(2B)
Surplus/(Deficit )
Acreage
Contribution
(2C )
Land Acquisition /
Reimbursement
Value/2
(2D)
In-Lieu Fee
for Deficit
Acreage
(2E)
Payment Due t o
City for Surplus
Acrea a
(2F)
Gross Impact
Fees for Park
Improvements
(2G )
Payment Due to
City for Par k
Improvements
(2H )
Net Fee Revenue
after Reimbursemen t
for Surplus Acreage/3
(21)
Net Impact Fee or
Reimbursement per Uni t
after Acreage Credi t
Single Family Multi-Family
King (5 .05)$200,000 $1,010,760 $0 $1,187,643 $0 $2,198,403 $11,223 $8,35 2
DeBlauw (4 .54)$200,000 $908,760 $0 $1,067,793 $0 $1,976,553 $11,223 $8,35 2
Cowan (1 .19)$200,000 $237,360 $0 $278,898 $0 $516,258 $11,223 $8,35 2
Garcia/Damon (0 .87)$200,000 $174,360 $0 $2,531,373 $0 $2,705,733 $6,481 $4,82 3
City of San Luis Obispo 11 .66 $200,000 $2,331,240 $$2,739,207 ($5,070,447 )
Total 0 .00 -$2,331,240 $2,331,240 $5,065,707 $2,739,207 $2,326,50 0
3.Total City Contribution Towards Surplus Parkland Acquisition and Improvemen t
(3A)(3B)(3C)(3D)(3E)(3F)(3G )
Per Acre Cost per Acre Total Park Total Cost of Park Fees Portion of Park Remainder of Par k
Land Acquisition to Improve Acres Improved Improved Parks to Be Collected Fees Used to Fees Used for
Cost Property By City Provided By City By City Reimburse City Improvements
$200,000 $235,000 11 .66 $5,070,447 $7,396,947 $5,070,447 $2,326,500
Includes property used for neighborhood park and existing sports fields ; excludes power line easements .
Value based on City estimates .
Does not reflect a credit if improvements are made by developer. Developer will receive fee credits for improvements per City annexation policy .
79 PH2-2 4
Public Facilities Financing Margarita Area Specific Pla n
9 .7 Implementation And Administratio n
The Airport and Margarita areas are anticipated to build out over a n
extended period . During this time, there are likely to be changes i n
land use plans, facility standards and design, cost estimates, an d
other assumptions that are incorporated in this financing plan . Th e
PFFP and City finance policies are designed to accommodate suc h
changes, while maintaining the security of bondholders . The impact
fee component of the PFFP will be put into effect by adoption of a
fee ordinance by the City Council . Pursuant to this ordinance, fee s
will be collected by the City, deposited into the designate d
account(s), and used to fund improvements in the Airport an d
Margarita areas . In addition, a Mello-Roos Community Facilitie s
District may be formed to provide a mechanism for debt issuance t o
generate lump sum funding for facilities in the first phase o f
development and potentially later phases . Following is a brie f
summary of tasks that will be required to implement the PFFP .
9 .7 .1 Updates And Revision s
The PFFP should be updated each time there is a significant chang e
in facility plans, land use plans, or infrastructure cost estimates .
When these items are revised, there will be a corresponding chang e
in the fair-share cost allocation to each type of land use anticipate d
within the Airport and Margarita areas . The Airport and Margarit a
area specific plans impact fees must also be adjusted to maintain a
nexus between facilities being funded and land uses paying suc h
fees .
The Mello-Roos formation documents set forth a list of facilities tha t
are authorized to be funded by the CFD . Should the City form a
CFD, maximum special tax rates will be adopted by the City Counci l
in the Resolution of Intention to form the CFD . Because a vot e
would be required in future years to amend the list of authorized
facilities or the maximum special tax rates, it is unlikely that either o f
these items will change . However, the actual special tax levied eac h
fiscal year may vary due to changes in development activity, interest
earnings on CFD accounts, bond interest rates, and debt service
requirements . The actual amount to be levied each year will b e
determined by the City and will be reflected on the property tax bill .
9 .7 .2 Individual Project Applications And Develope r
Reimbursements
When an individual project is submitted to the City for processin g
and approval, the facilities required to serve that project must b e
identified . Due to the incremental nature of public facility phasing, i t
is likely that certain projects will be required to oversiz e
improvements to accommodate future development . By comparin g
the project's assigned fair share of facility costs to the costs of
improvements required to allow the project to proceed, the City wil l
be able to calculate an equitable reimbursement to the develope r
paying for oversized improvements . The City will likely enter into a n
agreement with the developer to affect such a reimbursement .
9 .7 .3 Action Items For The Cit y
Prior to commencement of development in Airport and Margarit a
areas, the City will need to adopt a fee ordinance or resolutio n
implementing the fees . The initial ordinance will reflect fees base d
on the information provided in this PFFP . Fees may be adjusted i n
future years to reflect actual costs, updated infrastructure cos t
estimates, changes in the amount of property anticipated to develop ,
and other factors . In addition to specific fees for the Airport Area ,
development in the Airport and Margarita areas will be subject t o
citywide and add-on (for water and wastewater) fees as well as fee s
levied by other public agencies .
Pursuant to section 66006 of the Government Code, the City wil l
establish a capital facility account(s) for collected fees .
Establishment of this account(s) will prevent commingling of the fee s
with other City revenues and funds . Interest income earned by fee
revenues in these accounts will be deposited in the accounts an d
applied to facility construction costs . Within one hundred eight y
days of the close of each fiscal year, the City will make informatio n
pertaining to each account [as required by Section 66006 (b)(1)]
80 PH2-25
Margarita Area Specific Plan Public Facilities Financin g
available to the public and will review this information at a regularl y
scheduled public hearing .
Debt financing may be required to close funding gaps in the initia l
years of development . Development on certain properties in th e
Airport and Margarita areas cannot begin until certain backbon e
facilities are funded and constructed . Action items associated wit h
implementing such a CFD funding mechanism are discussed furthe r
below .
9 .7 .4 Community Facilities District Formation And Bond Sale s
The City will need a financing team if it chooses to use land-secure d
debt financing to provide services associated with the formation o f
the Mello-Roos Community Facilities District Financing tea m
members include a bond counsel, bond underwriter, financia l
advisor, appraiser, absorption consultant, and special tax consultant .
The City Council will need to approve a Resolution of Intention whic h
will notify the public of its intention to form the CFD, identify th e
boundaries of the CFD, list the authorized facilities to be funded, an d
identify the maximum special tax rates . At least 30 days after this,a
public hearing needs to be held, after which, the council will adop t
the Resolution of Formation of the CFD ("ROF"). The Mello-Roo s
law requires a 90-day waiting period between adoption of the RO F
and the CFD election . However, if a unanimous agreement exists
among all landowners in the CFD, the election can occur at th e
same meeting at which the ROF is adopted . Whenever the electio n
is held, a two-thirds vote is required to authorize the levy of specia l
taxes within the CFD . The actual amount and location of acreag e
owned by landowners who do not want to participate in the CF D
initially will be identified prior to adoption of the ROF and landowner
election . Existing developed properties in the specific plan areas wil l
be excluded from the CFD . Once the CFD is formed and a
successful election has occurred, the underwriter will prepare a
bond-offering document in order to market the initial bond issue t o
potential investors . As a matter of policy, the City may require tha t
the bond obligation associated with residential development be fully
prepaid by the homebuilder prior to the sale of the residence to th e
homeowner, which would eliminate the annual CFD tax .
9 .7 .5 Community Facilities District Administratio n
Formation of a Community Facilities District commits the City to th e
ongoing administration of the CFD . A Mello-Roos special tax is no t
a fixed lien on a parcel, but an annual lien that must be calculate d
and levied each year. The appropriate special tax will b e
determined by the City or its designee after consideration of annua l
debt service requirements, direct construction funding ,
administrative costs of the CFD, prepayments received, an d
development activity within the CFD . After the special taxes have
been calculated each fiscal year, they will be submitted to the count y
auditor to be included on the secured property tax bill .
Unlike property taxes, there is not a four to five year grace period fo r
collection of delinquent Mello-Roos special taxes . The City wil l
covenant in the bond documents to pursue foreclosure on delinquen t
parcels within a specified time frame, usually 150 days . As part o f
this covenant, the City must monitor delinquencies, notify delinquen t
taxpayers, and begin foreclosure proceedings if the delinquencies
are not remedied .
The City is also responsible for disclosing information regarding th e
CFD to the California Debt Advisory Commission and nationa l
repositories (pursuant to SEC Rule 15c2-12). Various informatio n
regarding delinquent special taxes, the balance in CFD accounts ,
assessed valuation, and other items must be compiled an d
submitted by designated due dates . As part of the bond issuanc e
process, the City will enter into a Continuing Disclosure Agreement
that will specifically identify the information that must be disclosed .
81
PH2-26
Attachment 2
(at,V O
sAt1 otIl ij,)(.
Parks and Recreatio n
THE GENERAL PLA N
APPENDIX C
PARK LAND ACQUISITION AND IMPROVEMENT IN ANNEXATION AREA S
A .OVERVIE W
The purpose of these guidelines is to provide a framework for achieving General Plan par k
system goals in annexation areas . While these guidelines are not intended to be "hard an d
fast rules," they are intended to provide sufficient direction to help ensure that :
1.We clearly communicate our goals — and method for achieving them -to
those proposing residential annexations in order to avoid an y
misunderstandings about development requirements and related costs .
2.We achieve these goals in the most effective manner possible .
B .GENERAL PLAN POLICIE S
The General Plan sets forth two key policies regarding the City's park system standards ,
and new development's responsibility to pay for the cost of the park land necessary t o
serve it :
3.The City shall develop and maintain a park system at the rate of 10 acre s
of park land per 1,000 residents (PR 6 .1 .1).
4.The costs of public facilities and services needed for new developmen t
shall be borne by the new development, unless the community chooses t o
help pay the costs for a certain development to obtain community-wid e
benefits (LU 1 .14).
C .IMPLEMENTATION GUIDELINE S
In accordance with General Plan policies, the City will use the following guidelines i n
acquiring and improving park land whenever State law allows us to do so .This is most
likely to occur in the case of annexations . However, these guidelines are also applicabl e
whenever discretionary approvals of the City are requested, such as zone changes ,
general plan amendments or development agreements .
5 . Park land acquisition and improvement goal .The City will achieve a ratio
of 10 acres of park per 1,000 residents projected to reside in th e
annexation area . This includes land and improvements .
a.Privately owned and maintained landscaped areas such a s
interior parkways and community greens may be considere d
as contributing to this goal . This will be determined on a case-
by-case basis depending on the purpose and nature of such
areas, and the level of public access to them .
b.School sites may also be considered as contributing toward s
this goal . This will be determined on a case-by-case basi s
depending on the location of the proposed school site t o
planned park sites, and the likelihood that the school site will
be used as a "joint use" facility .
c.Open space will not typically be counted as park land i n
meeting the 10 acres per 1,000 residents standard . The City's
General Plan is clear in its distinctions between open spac e
and parks, and the purpose of these guidelines is to hel p
implement the General Plan's park system goals, not ope n
space goals .
6 . Property owner dedication and developer improvement requirement :
Through an annexation agreement, the City will generally require th e
dedication and full improvement of required park land by the propert yowner and/or developer (applicant) as a condition of the annexation . Thi s
means that the City will typically not take the lead role in acquiring an d
improving parks in annexation areas ; this is the applicant 's responsibilit y
similar to the construction of other on-site, project-related infrastructur e
7-31
PH2-27
Attacnmeii L
Parks and Recreatio n
improvements such as streets, sidewalks, storm drainage collection, wate r
distribution lines and sewer collection lines .
7 . Acquisition and improvement phasing . The phasing of when dedicatio n
and improvements are required by the applicant will be set forth in th e
annexation agreement, specific plan or development plan . While this wil l
be determined on a case-by-case basis, land dedication and improvement s
should generally be phased as follows :
a.Land should be dedicated upon annexation .
b.Phase 1 improvements (as defined in the annexatio n
agreement, specific plan or development plan) should b e
completed before the first certificate of occupancy is issued ;
other improvement phases and standards may be establishe d
in the annexation agreement, specific plan or developmen t
plan .
c.All improvements should be completed by the time that abou t
two-thirds of the units are available for occupancy .
8 . Fees in-lieu of dedication and improvement . Depending on th e
circumstances, the City may prefer to develop some portion of the require d
park acquisition and improvements on property that is not being annexed .
This would generally occur when the City plans to meet part of the "1 0
acres per 1,000 residents" requirement through a community-wide facilit y
that is not located in the annexation area, or when the annexation area i s
not large enough to dedicate and improve a meaningful amount of par k
land . Whenever fees are paid in lieu of dedicating and improving par k
land, they will be :
a.Restricted solely for park land acquisition and improvement .
b.Determined, assessed, collected and accounted for in a
manner consistent with state requirements for developmen t
impact fees as set forth in AB 1600 .
c.Used for park land and improvements that directly serve th e
annexation area, unless a finding is made that the area i s
already adequately served by existing neighborhood facilities .
In this case, fees will be used to acquire or improv e
community-wide facilities .
9 .Case-by-case review . The following issues will be addressed on a case -
by-case basis as part of the specific plan or development review process :
a.Amount of park land to be dedicated and improved within th e
annexation areas versus the amount that will be met throug h
the payment of in-lieu fees in meeting the overall goal of 1 0
acres of parks per 1,000 residents .
b.Location and type of park land to be developed in th e
annexation area .
c.Value of the park land and improvements that will not b e
developed in the annexation, and the resulting amount of fee s
to be paid .
d.Timing as to when these fees will be paid .
e.Timing as to when park improvements will be made by th e
applicant .
f.Distribution of any in-lieu fees between neighborhood versu s
community parks and facilities, and the need to redress an y
deficit in the availability of neighborhood parks in the vicinity o f
the annexation area .
7-32
PH2-2 8
THE G
Attachment 3
RESOLUTION NO . (2012 SERIES )
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISP O
APPROVING AMENDMENTS TO CHAPTER 9 TH E
PUBLIC FACILITIES FINANCING PLAN OF TH E
MARGARITA AREA SPECIFIC PLA N
SPA 53-1 2
WHEREAS, the Planning Commission of the City of San Luis Obispo conducted a publi c
hearing in the Council Chamber of City Hall, 990 Palm Street, San Luis Obispo, California, o n
June 13, 2012 to review amendments to the public facilities plan, Chapter 9 of the Margarit a
Area Specific Plan, City of San Luis Obispo Community Development, applicant ; an d
WHEREAS, the City Council of the City of San Luis Obispo conducted a public hearin g
in the Council Chamber of City Hall, 990 Palm Street, San Luis Obispo, California, on July 17 ,
2012 for the purpose of considering Application SPA 53-12 ; and
WHEREAS, notices of said public hearings were made at the time and in the manne r
required by law ; an d
WHEREAS, the Specific Plan Amendments are warranted to reflect amendments to th e
parkland impact fees and to implement updated impact fee structures for traffic, water an d
wastewater; and
WHEREAS, the Council has duly considered all evidence, including the recommendatio n
of the Planning Commission, testimony of interested parties, and the evaluation an d
recommendations by staff, presented at said hearing .
BE IT RESOLVED, by the City Council of the City of San Luis Obispo as follows :
SECTION 1 .Environmental Determination .The City Council finds and determines tha t
the amendments to the financing plan are exempt from CEQA based on Section 15061 b (3).
According to this provision, where it can be seen with certainty that there is no possibility tha t
the activity in question may have a significant effect on the environment, the activity is not
subject to CEQA .
SECTION 2 .Findings .The amendments to Chapter 9 of the Margarita Area Specifi c
Plan as shown on the attached Exhibit A, are hereby approved, based on the following findings :
Findings .
The proposed amendments to the Specific Plan are consistent with General Plan Lan d
Use Element Policy 1 .13 because the Damon Garcia Sports fields have been utilize d
community-wide since 2005 without being utilized by the anticipated residentia l
development in the Margarita area .Policy 1 .13 directs that the costs of public facilitie s
and services needed for new development shall be borne by new development, unless th e
PH2-29
City Council Resolution No . (2012 Series)
Attachment 3
Page 2
community chooses to help pay the costs for a certain development to obtain community -
wide benefits . The Damon Garcia Sports fields are a community-wide benefit .
2.The proposed amendments to the Specific Plan will not reduce the amount or quality o f
parkland proposed in the Margarita Area Specific Plan because the amendments do not
reduce the funding available for new parks in the specific plan area . New developmen t
will still be responsible for maintaining the General Plan policy of providing 10 acres o f
parkland per 1,000 residents .
3.The proposed amendments will help to clarify the fee structure for parkland and allo w
the fee structure to be more transparent .
4.The proposed amendments will help accelerate the development of anticipated housin g
projects within the specific plan area because residential impact fees will be reduced fo r
new development .The development of housing will, in turn, accelerate the construction
of Prado Road which is a significant east-west transportation corridor in the City .
5.The proposed amendments are not subject to CEQA because the amendments are no t
considered a "project" under CEQA and the changes to the fee structure do not trigge r
any changes to development scenarios or any other physical components of the specifi c
plan . Therefore, Section 15061 b (3) of CEQA applies to this amendment .
SECTION 2 . Action . The City Council does hereby adopt revisions to the Margarit a
Area Specific Plan as shown in Exhibit A .
On motion of , seconded by , and on
the following roll call vote :
AYES :
NOES :
ABSENT :
The foregoing resolution was passed and adopted this day of , 2012 .
Mayor Jan Howell Mar x
ATTEST :
Sheryll Schroeder, Interim City Clerk
PH2-30
City Council Resolution No . (2012 Series)
Attachment 3
Page 3
APPROVED AS TO FORM :
Christine Dietrick, City Attorney
PH2-31
Exhibit A Attachment 3
Margarita Area:Park Fees
The City's parkland standards are set forth in the General Plan at 10 acres per 1,000 residents . In implementing this standard, th e
Council adopted the policy Park Land Acquisition and Improvement in Annexation Areas in April 1998 . In summary, this polic y
provides that new development in annexation areas (as well as when discretionary approvals are requested, such as zone changes ,
general plan amendments or specific plans) is responsible for the cost of acquiring and improving park land as required to meet thi s
General Plan standard unless the community chooses to help pay the costs for certain development to obtain community-wid e
benefits .
Since this standard is only applicable to residential development, it was not included with the joint Airport/Margarita Are a
infrastructure analyses . Instead, the City prepared a separate analysis of parkland costs, fees and credits in March 1998 . Thi s
analysis has been updated to reflect changes since then and was most recently updated in 2012 to reflect changes in the use of th e
Damon-Garcia sports fields to reflect increased citywide use . The results are presented in Table 12 A .
The following summarizes the key assumptions in this analysis :
1.Based on 836 housing units and population per household from the 2010 Census, there will be approximately 1,835 resident s
in the Margarita Area .
2.At 10 acres per 1,000 residents, this means that new development in this area is responsible for providing approximatel y
18 .35 acres of developed parkland .
4.The plan calls for 25 acres of parkland in this area : 9 .9 acres in neighborhood park and 15 .1 acres in sports fields . Only 18 .3 5
acres is required to meet policy levels of 10 acres of park land per 1,000 residents . Since original adoption of this plan i n
2004, the Damon-Garcia sports fields have been developed and utilized as a Citywide facility therefore some of the cost s
originally anticipated as being the sole responsibility of the Margarita Area development have been shifted to Cit y
responsibility . Of the total parkland planned for the area, new development is responsible for 12 .9 acres and the City i s
contributing 5 .45 acres towards the per capita increase . The remaining 6 .65 acres is further contributed to provide a
community-wide benefit . In meeting the standard for this area, this results in 9 .9 acres in neighborhood parks and 8 .45 acre s
in sports fields attributable to the increase in MASP population . Land costs are estimated at $300,000 per acre for the future
neighborhood park and $200,000 in actual costs for the Damon Garcia sports fields . Park development costs are $235,00 0
per acre for both the Damon Garcia sports fields and the proposed neighborhood park .
5.Those who dedicate parkland within the Margarita area will receive a fee credit based on the land and improvement value of
the dedicated parkland .
This results in the following park fees per unit :
Single Multi -MASP Park Fees Per Residential Unit Family Family
All Development $8,109 $6,829
PH2-32
Resolution No . 2012 Serie s
SPA 53-12 Margarita Area Specific Pla n
Page 5
PH2-33
Resolution No . 2012 Series
SPA 53-12 Margarita Area Specific Pla n
Page 6
Table 1 2
AIRPORT AREA/MARGARITA AREA PROJECT SPECIFIC &CITYWIDE IMPACT FEE S
Updated July 1, 201 2
(1)Excludes Park Improvement Fees : See Table 12a .
(2)In addition to the Airport/Margarita Area project specific impact fees, new development in the Specific Plan areas will also be subject to citywide an d
Airport/Margarita add-on impact fees ; citywide and add-on impact fee rates are effective as of July 1, 2012 .
(3)Water and wastewater impact fees are based on meter size for non-residential uses in determining "equivalent dwelling units ." For example, a 3/4- inc h
meter is the equivalent of one single-family residence (EDU); a one-inch meter is two EDU's ; a two-inch meter is 6 .4 EDU's ; and a three-inch meter is 14 ED I
PH2-34
Airport &Airport &
Total Margarita Margarita
Project Citywide Areas Citywide Areas Citywid e
Specific Impact Fees Water Water Wastewater Wastewater Transportatio n
Transportation Plan Costs (Note 1)Fee Add-On Fee Fee Add-On Fee Fe e
Margarita Area : Project Impact Fees Citywide and Add-On Impact Fees (Note 2 )
Residentia l
Single Family Detache d
Multifamily
Total
Per Unit Per Unit
$9,551 $197 $9,74 8
35,893 $187 $6,08 0
Nonresidential Per 1,000 SF
Tota l
Per 1,000 S F
Retail $43 .055 $173 $43,22 8
Office/R&D/Lt. Man .$18 .077 $173 $18,250
$34,184 $1,907 $8,553 $3,644 $5,35 2
$34 .184 $1,907 $8 .553 $3,644 $5,35 2
Airport Area : Project Impact Fees (based on year 2005 )
Nonresidential Per 1,000 S F
Office/R&D/Lt. Man .('ADT trips) (per acre )
Service Commercial $3,410 (per acre )
Manufacturing/Indus .$680 per acre)
Citywide and Add-On Impact Fees (Note 2)
Per 1"Meter (Note 3)Pe r 1,00 0 S F
$34 .184 $1 .907 $8 .553 $3,644 $6,93 0
$34,184 $1,907 $8,553 $3,644 $3 .76 0
$34 .184 $1,907 $8,553 $3 .644 $2,00 0
Per Uni t
$17 .092 $954 $4 .132 $1,822 $2 .54 7
$13 .673 $763 $3 .306 $1 .457 32 .26 0
Per 1" Meter (Note 3)Per 1,000 SF
Resolution No . 2012 Series
SPA 53-12 Margarita Area Specific Pla n
Page 7
TABLE 12A
City of San Luis Obisp o
Margarita Area Specific Pla n
PARK IMPROVEMENT FEE S
(updated 201 2
Parkland Assumptions (acres)
Development Responsibility 12 .9
City Contribution toward s
(per-capita)5 .45
Total 18 .35
(IA)(1B)(IC)(ID)(1E)(IF )
Residential Population Park Acreage Actual Surplus/(Deficit )
Units Proposed Generated Required Based Park Acres Acreage
Owner and APN Single Family Multi-Family From Units on City Standard Dedicated/1 Contribution
(1G)(1H )
City Contribution Development Responbility
King (053-022-016)165 32 433 4 .33 (4 .33)$1,556,51 3
Resmark (DeBlauw 053-022-014 8, 0 121 23 316 3 .16 (3 .16)$1,138 .256
City of San Luis Obispo 0 .00 8 .45 8.45 $2,377,500
Resmark (Cowan 053-022-013)56 126 1 .26 (1 .26)$454,104
Garcia/Damon (053-431-002)355 84 960 9 .60 9 .90 0 .30 $3 ;452,33 1
Total 697 139 1,835 18 .35 18 .35 0 .00 $2,377,500 $6,601,204
Single Family Residential
2 .2 5
10 .0 0
0 .0225
Multi-Family Residential
1 .92
10 .00
0 .0192
Population per Househol d
City Park Standard (acres per 1,000 res .):
Parks Acres Required per Household :
Park Costs :
Land Aquistion Costs :
Population Per Househol d
City Park Standard (acres per 1,000 res .):
Parks Acres Required per Household :
$235,000 per acr e
$300,000 per acr e
PH2-3 5
Resolution No . 2012 Serie s
SPA 53-12 Margarita Area Specific Pla n
Page 8
Attachment 4
RESOLUTION NO . (2012 Series )
A RESOLUTION OF THE CITY COUNCIL OF SAN LUIS OBISPO AMENDIN G
THE PARKLAND IMPACT FEES IN THE MARGARITA ARE A
SPA 53-1 2
WHEREAS, the Council adopted the Margarita Area Specific Plan on October 12 ,
2004 following extensive public hearings by the Planning Commission and City Council ;
and
WHEREAS, Chapter 9 (Public Facilities Financing) of the Margarita Are a
Specific Plan (MASP) provides a detailed description of the parkland needed to serve thi s
area and their costs along with a method of apportioning these costs between types o f
development; and
WHEREAS, the Council adopted park impact fees for the Margarita Area o n
January 5, 2004 based on this financing program in compliance with the provisions o f
Section 66000 of the Government Code (AB 1600);an d
WHEREAS, under the fee program adopted at that time by the Council, wheneve r
the actual or estimated costs of facilities identified in the impact fee analysis changes, the
Director of Finance & Information Technology (Director) shall review the impact fees an d
determine whether the change affects the amount of the impact fees ; and if the impact fee s
are significantly affected, the Director shall, within thirty (30) days, recommend to th e
Council a revised fee for their consideration ; and
WHEREAS, reducing the proportion of responsibility for the MASP to fun d
construction of the Damon-Garcia Sports Fields does not impact the Specific Plan's
ability to meet the General Plan policy of providing 10 acres of parkland per 1,00 0
residents ; and
WHEREAS, General Plan Land Use Element Policy 1 .13 directs that the costs o f
public facilities and services needed for new development shall be borne by ne w
development, unless the community chooses to help pay the costs for a certai n
development to obtain community-wide benefits and the Damon Garcia Sports fields hav e
been utilized community-wide since 2005 without being utilized by the anticipate d
residential development in the Margarita area ;and
WHEREAS, the Planning Commission of the City of San Luis Obispo conducte d
a public hearing in the Council Chamber of City Hall, 990 Palm Street, San Luis Obispo,
California, on June 13, 2012 pursuant to a proceeding instituted under application SP A
53-12, City of San Luis Obispo Community Development, applicant ; and
WHEREAS, the Planning Commission found that the Damon-Garcia Sports Field s
serve a community need and provide community-wide benefits and the cost of developin g
the facility is therefore appropriate to share in different proportions ; and
PH2-37
City Council Resolution No . (2012 Series )
Page 2
Attachment 4
WHEREAS, the City Council conducted a public hearing on July 17, 2012 and ha s
duly considered all evidence, including the testimony of the applicant, interested parties ,
and the evaluation and recommendations by staff, presented at said hearing .
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Sa n
Luis Obispo that park impact fees in the Margarita Area are hereby revised as set forth i n
Exhibit A effective and that all other provisions of Resolution No . 9643
remain in effect :
SECTION 1 . Environmental Determination . The City Council finds an d
determines that the amendments to the financing plan are exempt from CEQA based o n
Section 15061 b (3). According to this provision, where it can be seen with certainty tha t
there is no possibility that the activity in question may have a significant effect on th e
environment, the activity is not subject to CEQA .
SECTION 2 .
Action. The City Council does hereby adopt revisions to th e
Margarita Area Specific Plan Parkland Impact Fees as shown in Exhibit A .
On motion of , seconded by
and on the following roll call vote :
AYES :
NOES :
ABSENT :
The foregoing resolution was passed and adopted this day of , 2012 .
Mayor Jan Howell Marx
ATTEST :
Sheryll Schroeder, Interim City Cler k
APPROVED AS TO FORM :
Christine Dietrick, City Attorney
PH2-38
City Council Resolution No . (2012 Series )
Page 3
Attachment 4 Exhibit A
r'~argCa ra Area :,Fees
The City's parkland standards are set forth in the 'General Flan at 10 acres . per 1 .000 residents Per impiementing this standard, th e
Council adopted the policy Park 1 _orb ^'c _ _ rstto,~ and improvement in 4,r ,es.~;rion hens in April 1990 . In summary, this pok y
provides that new.development in annexation areas (as_.well as when discretionary approvals are requested .. such as zone changes ,
general plan amendments or specific : plans) is responsible for the cost of acquiring and improving park land as required to meet thi s
General Flan standard unless the :community chooses to .help pay the costs fcc certain development to, obtain community-wid e
benefits .,
-Since this standard is only applicable to residential development, it was not included with the joint Airport-TA argarita Are a
infrastructure analyses .. Instead, the City prepared a separate analysis of parkland costs, fees and credits in March 1998 . Thi s
analysis has been updated to reflect changes since then and was most recently updated in 2012 to reflect changes in the use of th e
Damon-Garcia sportsfields toreflectincreased citywide use .T,andthe results are presented in. Table 12 A .aft-
The following summarizes the key assumptions in this analysis :
Based on 268 836housing units and population . per houisesoid from the -_20'1(?Censers . there will' be 2,156 approximatel y
L835residents in the fIvIargarita Area .
2.At 1 Li ac r es per 1,.000 residents . this means. that new development in this area is responsible for providing approximatel y
1 ;'.35acres of developed parkland .
3.`—-TThe plan calls for 25 acres of parkland in this area : ?_9 acres in neighborhood park and 15 .1 acres in sports fields _
~?nl'y 1'8 .35 acres is required to meet etpolicylevelsof10acres of park land per 1,000+1
residentspopulntion ..Since original adoption of this plan in 2004, the Damon-Garcia sports fields have been developed an d
utilizedas ar-it,^ ridie facility therefore some of the costs originally anticipatedas being the soleresponsibilityof the Margarit a
Areadevelopmenthave been shifted to City responsibility .Of the total parkland planned: for the area ... new development i s
responsible for-21 .56 12 .9 acres and the City for -is. contributing 3 .11 5 .45 acres towards the per capita increase_Th e
remaining C'1 5 acres is furthercontributedto provide a comr-nunit ,,e wide benefit_.In meeting the standard for this. area, thi s
results in 9 ..9 acres in neighborhood parks and 11 .Et 8 .45_acres in sports fields attributable . to the increase in P .~1AS F
population --
4 . Land costs are e` tirriate~l at $3200 .000 per acre frr;r the future neighborhood park anc 200,000 in actual rusts . for the Damo n
Garcia sports fields ::..and pF'ark development costs at are$.235,000 per acre for both the Damon Garcia sports fields and th e
proposed neighborhood park,,
.5 ..Those who dedicate parkland . 'within the Margarita area ill receive a fee credit based on tl land' and improvement value o f
the dedicated parkland_"~i
This results in tne.tOiIOWinq park fees per unit:.
MASP Park Fees Per Residential Unit Singl e
Family
1,.lulti -
Famil y
Development Dedicating L ndfr 1°1ee 1,823
lveloprr-ient 8 109 $0 .82 9
Other Level _rpment riot de iicotinq '9,352-
ar-kc1,ah
field coots allocable to the Margarita rco_1
PH2-3 9
City Council Resolution No. (2012 Series)
Attachment 4
Page 4
Table 1 2
AIRPORT AREA/MARGARITA AREA PROJECT SPECIFIC &CITYWIDE IMPACT FEE S
Updated July 1, 201 2
(1)Excludes Park Improvement Fees : See Table 12a .
(2)In addition to the Airport/Margarita Area project specific impact fees, new development in the Specific Plan areas will also be subject to citywide an d
Airport/Margarita add-on impact fees ; citywide and add-on impact fee rates are effective as of July 1, 2012 .
(3)Water and wastewater impact fees are based on meter size for non-residential uses in determining "equivalent dwelling units ." For example, a 3/4- inch
meter is the equivalent of one single-family residence (EDU); a one-inch meter is two EDU's ; a two-inch meter is 6 .4 EDU's ; and a three-inch meter is 14 ED I
PH2-4 0
Airport &Airport &
Total Margarita Margarita
Project Citywide Areas Citywide Areas Citywid e
Specific Impact Fees Water Water Wastewater Wastewater Transportation
Transportation Plan Costs (Note 1)Fee Add-On Fee Fee Add-On Fee Fe e
Margarita Area : Project Impact Fees Citywide and Add-On Impact Fees (Note 2 )
Residential Per Unit
Total
Per Unit Per Uni t
Single Family Detached 89 .551 8197 $9,748 $17 .092 $954 $4 .132 $1,822 82 .54 7
Multifamily $5 .893 $187 $6,080 $13 .673 $763 $3,306 $1,457 $2,26 0
Nonresidential Per 1,000 SF
Tota l
Per 1,000 SF Per 1" Meter (Note 3)Per 1,000 S F
Retail $43 .055 $173 $43,228 $34 .184 $1 .907 $8,553 $3,644 $5 .35 2
Office/R&D/Lt . Man .$18 .077 5173 $18,250 $34,184 $1 .907 $8 .553 $3,644 55,352
Airport Area : Proiect Impact Fees (based on year 2005 )
Nonresidential
Per 1,000 S F
Office/R&D/Lt . Man .(ADT [rips) (per acre )
Service Commercial $3,410 (per acre )
Manufacturing/Indus .$680 (per acre)
Citywide and Add-On Impact Fees (Note 2),
Per 1" Meter (Note 3)Per 1,000 S F
$34,184 $1,907 $8,553 $3,644 $6,93 0
$34 .184 $1,907 $8,553 $3,644 $3,76 0
$34 .184 $1,907 $8 .553 $3,644 52 .00 0
City Council Resolution No . (2012 Series)Attachment 4
Page 5
(updated 2012 )
Development Responsibility 12.9
(IC)
Populatio n
Generated
From Units
(ID)(1E)(IF)(1G)(1H )
Park Acreage Actual Surplus/(Deficit)City Contribution Development Responbilit y
Required Based Park Acres Acreag e
on City Standard Dedicated/1 Contributio n
City Contribution towards
(per-capita)5 .4 5
Total 18 .3 5
(IA)
Owner and APN
(1B )
Residential
Units Propose d
Single Family Multi-Family
King (053-022-016)165 32 433 4 .33 0 (4 .33)$1,556,51 3
Resmark (DeBlauw 053-022-014 & 0 121 23 316 3 .16 0 (3 .16)$1,138,25 6
City of San Luis Obispo 0 .00 8 .45 8 .45 $2,377,500 0
Resmark (Cowan 053-022-013)56 0 126 1 .26 0 (1 .26)$454,104
Garcia/Damon (053-431-002)355 84 960 9 .60 9 .90 0 .30 $3,452,33 1
Total 697 139 1,835 18 .35 18 .35 0 .00 $2,377,500 $6,601,204
Single Family Residential Multi-Family Residentia l
Population per Household 2 .25 Population Per Household 1 .92
City Park Standard (acres per 1,000 res 10 .00 City Park Standard (acres per 1,000 res .):10 .00
Parks Acres Required per Household :
Park Costs :
Land Aquistion Costs :
0 .022 5
$235,000 per acre
$300,000 per acre
Parks Acres Required per Household :0 .0192
Parkland Assumptions (acres)
PH2-4 1
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